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Federal Register / Vol. 86, No. 179 / Monday, September 20, 2021 / Proposed Rules Commission sought comment on a range of common practices in MTEs that could have the effect of dampening competition or deployment. We seek to refresh the record to better understand how the Commission can best facilitate enhanced deployment and greater consumer choice for Americans living and working in MTEs. The Commission has defined MTEs as commercial or residential premises such as apartment buildings, condominium buildings, shopping malls, or cooperatives that are occupied by multiple entities.
Revenue Sharing Agreements. We seek to refresh the record on the impact revenue sharing agreements have on competition and deployment of facilities in MTEs. In the NPRM, the Commission explained that revenue sharing agreements are contracts between MTE owners and service providers where the owner receives consideration from the communications provider in return for giving the provider access to the building and its tenants. The Commission recognized that revenue sharing agreements can take various forms. For example, they can be simple one-time payments calculated on a per-unit basis sometimes referred to as door fees; or they can be pro rata, calculated as a portion of revenue generated from tenants subscription service fees. These pro rata agreements may also be graduated, where the building owner receives more revenue as the proportion of tenants in a building choose that service provider. And some revenue sharing agreements may be considered above costthat is, they may give MTE owners compensation beyond actual costs associated with the installation and maintenance of wiring.
The Commission sought comment on the impact revenue sharing agreements have on competition and deployment, as well as whether they reduce incentives for building owners to grant access to competitive providers given that a lower number of subscribers for the incumbent provider means reduced income to the building owner. It also asked whether revenue sharing agreements were being used to circumvent Commission rules prohibiting exclusive access agreements, whether alone or in combination with other contractual provisions.
We seek to refresh the record on whether the Commission should restrict some or all of these types of revenue sharing agreements. Have there been changes over the last two years as to how frequently these agreements are used in MTEs? How do these agreements affect the ability of tenants
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to choose their service provider? How do they affect the prices that tenants ultimately pay for service? What are the effects of these agreements on competition among service providers?
Do these agreements promote or inhibit entry by competitive providers? In what ways do revenue sharing agreements affect how service providers compete for customers? Do they encourage or discourage service providers to compete on the basis of price or service quality?
Do service providers attempt to negotiate agreements that work to exclude competitors? If revenue sharing agreements function to prevent competing providers from deploying, does the MTE in effect become a locational monopoly? What legitimate reasons might a competitive provider and building owner have to enter into such agreements? For example, do these agreements affect competitive providers ability to offer services in MTEs, such as by enabling providers to secure financing to deploy facilities? Do the drawbacks of such agreements outweigh any benefits? Should the Commission restrict the use of revenue sharing agreements? Alternatively, should the Commission require the disclosure of such agreements?
We seek comment on whether the Commission should address specific types of revenue sharing agreements.
For example, should it restrict abovecost revenue sharing agreements? If so, how should the Commission define costs? How would any such restrictions impact tenants? How could the Commission best and most effectively monitor compliance? Additionally, we seek comment on whether the Commission should take action to address graduated revenue sharing agreements. To what extent do such agreements lead building owners to favor one provider over others and to exclude competitors? Similarly, we seek comment on revenue sharing agreements containing exclusivity provisions that may prevent building owners from offering equal terms to other providers. Do such provisions negatively affect competition and deployment in MTEs? Should the Commission restrict or prohibit such agreements, or require their disclosure?
Are there any other provisions in such agreements that may serve to hinder competitive access?
Exclusive Wiring Arrangements.
Second, we seek to refresh the record on the effect of exclusive wiring arrangements on competition and deployment of facilities in MTEs. In the NPRM, the Commission explained that under an exclusive wiring arrangement, service providers enter into agreements
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with MTE owners under which they obtain the exclusive right to use the wiring in the building. The Commission sought comment on whether it remained true that, as it had previously concluded in 2007, exclusive wiring arrangements do not preclude competitive providers access to buildings. It also asked whether such arrangements differ in states and localities where mandatory access laws have been introduced.
We seek to refresh the record in light of possible developments since the NPRM. Should the Commission revisit its conclusion that exclusive wiring arrangements generally do not preclude access to new entrants, and thus do not violate its rules? What are the practical effects of exclusive wiring agreements in todays communications marketplace?
Can exclusive wiring arrangements otherwise circumvent Commission rules? What anti-competitive effects or adverse impacts on deployment, if any, do exclusive wiring arrangements have?
What benefits, if any, do exclusive wiring arrangements have, and do the benefits outweigh any drawbacks, particularly to tenants? Do exclusive wiring arrangements affect tenants choice in providers? Do they inhibit entry by competing service providers?
Do they encourage or discourage service providers to compete on the basis of price or service quality? Are there specific varieties of exclusive wiring arrangements, such as those containing provisions for exclusive use of MTEowned wiring, that the Commission should study? What are the benefits and drawbacks of shared access to wiring and other facilities, in contrast to exclusive wiring arrangements? Does shared access promote competitive entry and tenant choice?
We seek to refresh the record on saleand-leaseback arrangements, a subset of exclusive wiring arrangements. In the NPRM, the Commission explained that sale-and-leaseback arrangements occur when a service provider sells its wiring to the MTE owner and then leases back the wiring on an exclusive basis. The Commission has in place rules that facilitate competitive choice by making the previous providers inside wiring available to MTE owners and tenants for other service providers to use after it has terminated service. Do sale-andleaseback arrangements act as an end run around these rules by putting wiring ownership in the hands of the building owner, which is not subject to the Commissions rules? Regardless of whether they in effect act as a loophole, should the Commission prohibit such arrangements generally or in limited circumstances? The Commission also
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